Compensation culture? Stats reveal claims numbers in freefall

Government figures published as parliament prepares to debate curbs on personal injury claims appear to show the number of such claims dropping to the lowest level for almost a decade.

The Department for Work and Pensions’ Compensation Recovery Unit (CRU) reported yesterday that the total number of cases registered with it fell by 13% to 853,615 in 2017/28.

The biggest sources of cases, motor claims, fell year-on-year by 17% to around 650,000. Clinical negligence cases dropped 3% to 17,400 in 2017/18.

CRU figures are considered to be an important yardstick for measuring claims numbers, as the DWP must be notified of details of any claim by the organisation or person paying compensation.

They appear to douse cold water on the government’s rationale for sweeping changes affecting personal injury and clinical negligence claims.

Last month David Gauke introduced the Civil Liability Bill by saying the number of whiplash claims had been ‘too high for too long’, and was ‘symptomatic of a wider compensation culture’.

The legislation, due for second reading the House of Lords today, will introduce fixed tariffs for RTA claims and ban settlements being made without a medical examination. The government also intends to increase the small claims limit to £5,000 for RTA claims and is looking at increasing the scope of fixed recoverable costs following a review by Lord Justice Jackson.

The long-term CRU figures show that government intervention has often led to a spike or dramatic fall in cases registered.

Before the Legal Aid, Sentencing and Punishment of Offenders Act in 2013, motor claims exceeded 800,000 in the two previous years as lawyers seemed to capitalise on more favourable conditions. Conversely, when the reforms restricted motor claims, work migrated to other sectors: employer liability claims rose 15% while clinical negligence also increased 16%. Rises in both sectors stopped after 2013/14 and figures have dropped year-on-year ever since.

The Association of Personal Injury Lawyers said that the fall in the number of motor claims undermined the case for reform. ‘This discredits the principles behind the Civil Liability Bill,’ said APIL president Brett Dixon. ‘Injury claims are not behind rising premiums. The mischief clearly lies elsewhere.’

Paul Nicholls can you please confirm that
1) your firm "don't use medical agencies either"
2) The reasons why your firm has not signed their support to A2J if this issue isn't widespread as you mentioned "don't think that's a widespread thing that's done in any event"
3) This quote is 100% correct " I don't do any work via CMCs, never had, never would. I have never paid a referral fee, and find that practice repugnant"

But Paul you originally posted @ 14:46 GMT that you "don't use medical agencies either" and now you state "I routinely do use agencies in that regard"
Maybe your rose tinted original post was simply written after a day in the House of Lords trying your hardest to believe the insurance industry are to blame for all the issues leading to the reforms

The anonymous poster - you can't feasibly avoid using an agency (unless you instruct via MedCo directly). I routinely do use agencies in that regard, as you have very little choice to do so otherwise. Using a direct medical is often fraught with problems as against an agency in that regard.

But my comment is based on Paul stating the issue is not widespread so I see no reason why he wouldn't support the A2J if he feels its a minority.
Its the head in sand approach generally adopted by people with years of experience but little relevant experience in low factory farmed low value claims that seem to think its all fabricated by the insurance industry.

Reply to Anon 26 April 10.27 GMT
I have experience on both sides of the PI fence but currently work in the Claimant sector. I don't believe that Paul Nicholls can be criticised for not signing p to A2J. Why should he?
They don't seem to have made any difference to the debate or the reforms taking place.
And if you talk to any insurer, I also suspect that a number of firms shown on their website are suspected to have engaged in the sort of practices (with CMCs, in bed with medical agencies/own their own medical agencies etc) that have caused the collapse of the PI market. If I were running my own Claimant PI firm, I'd stay well clear of A2J.

Can you please explain why your firm has not signed up for A2J if you don't think the issues raised by the insurance industry is widespread as you quote "and don't think that's a widespread thing that's done in any event"

Hi Paul
It seems you've put your head above the parapet today!
I think what a number of posters are saying that if you are running a mix of PI work but have 20-30 portal claims on the go at any one time, you cannot escape using medical agencies as that is the purpose of MedCo's existence. If you're running these claims but sidestepping MedCo, can you explain why?

Just saw some other comments. I am the Senior partner of my firm, but certainly do handle low value PI cases, probably 20-30 portal cases - and of course larger multi track too, amongst a variety of other matters. I do so because I need to keep my finger on the pulse, to understand the nuances of the PI debate for MASS.

As for firms with Fee earners at firms 20-40 yrs PQE, I can think of dozens and dozens who deal with portal cases. In fact, most of the PI firms I think about have teams dealing with portal work, and others dealing with bespoke MT work.

There are also a number of long service fee earners who do the same as me - portal work, alongside the other work - to ensure they keep abreast of the changes. I deal with MedCo on a daily basis, and am very, very well aware of their workings, shortcomings etc. I'm additionally involved in discussions on a working party with medical agencies and other stakeholders, so know a fair bit more than what one of the anonymous poster suggests.

So the answer is no you haven't signed up to A2J? is there a particular reason why you have chosen not to help your profession.
I post anonymously because I work in the insurance industry and I don't claim to speak on behalf of that industry

I don't much like replying to anonymous posters as I don't understand the context of questions. However:

I opened my own firm in 2010. I have never ever paid a referral fee, nor worked for a CMC here. I'm very old fashioned about that.

Years back I learnt the trade at Thompsons and Rowley Ashworth. In fact, I recall working for Care Assist at one firm where they paid us to take on a case for PI. I also did lots of LEI and Trade Union / insurer work. I still do some Defendant work, though that's very much in the minority now.

Maybe my former firms did pay referral fees, I don't know. I was never a partner at any other firm, or part of the management structure. I was too busy fee earning.

Re the A2J campaign, I do follow what they Tweet about etc. In fact, I now realise I was sat next to a couple of chaps from A2J in the Strangers Gallery at the Lords watching the debate a few days ago, but didn't know them at the time. I know a few of the folks involved in A2J, but not currently part of that campaign. I'm currently VC of MASS, so very involved and spend all of my spare time working in that forum.

Reply to Paul Nicholls
I'm pretty sure that if you've had such a long career in PI as you say you have, then PI firms you will have worked for in the past will undoubtedly have paid fees to CMCs for referring cases or in fact just "leads" which didn't turn into a profitable case at all.

With all due respect I doubt many of the firms who these reforms affect the most have anybody working for them with 40, 30 or 20+ years of RTA experience, if they did have that much experience I very much doubt they deal with low value whiplash claims.
Clearly with time to sit in the house of lords yesterday you cant be that busy representing many claimants...can you also confirm if your company has signed up for A2J

Your comments about medical agencies confirms you don't deal with low value MOJ portal claims and clearly you don't talk on behalf of the vast majority of practices that these reforms affect, thank you anyway

Someone anonymously commented below that without CMCs there would be no work.

Really?

Well, I'm busier than ever, and I don't do any work via CMCs, never had, never would. I have never paid a referral fee, and find that practice repugnant.

I don't use medical agencies either - other than reputable ones where the payment terms are extended to help the client, and my office. I get no kick backs, wouldn't entertain the idea, and don't think that's a widespread thing that's done in any event.

I'm afraid the anonymous poster seems to think that the sins of the VERY few should be accounted by the many.

We've had all sorts of nonsense to put up with - ludicrous reforms, slashed costs, budgeting, sanctions, hikes of court fees by 620% against the judiciary telling us that claims are too expensive, and then constantly, constantly, having to battle against changes predicated for the insurance industry.

This is not a job for the faint hearted, there are many who are fighting to survive - the suggestion of back-handers and nefarious dealings are the stuff of absolute fantasy. Quite often the stories are predicated by, or on behalf of insurers, and then repeated over and over.

I sat in the Strangers Gallery at the House of Lords yesterday, listening to the second reading of the Civil Liability Bill. There were some utterly clueless 'Daily Mail' observations peddled, but, thankfully, some really sensible, thoughtful contributions from Lord Mackay, Baron Monks, and the absolutely on point Baroness Berridge - counsel with a PI background.

When you listen to debate on this subject, carefully ask yourself first whether the person who pontificates has any experience in the PI field. Then sit back and listen to those with 20, 30, or 40 years or more experience in the field, and try to get a balanced, rather than partisan view.

I act for Claimants and Defendants alike, and have for 34 years now. It would be foolish to suggest that the proposed reforms are 'necessary' or proportionate. There is, without doubt, a very clear insurance driven focus, and I am afraid I find the way that PI has gone, and is heading, extremely concerning.

I thought law was about advancing the rights of a party, whoever that party appears to be, not kneecapping them.

Why would we expect to see a year on year growth in claims, new cars are far more sophisticated and safer than ever before, more dash cams being fitted and purchased to vehicles than ever before, far more convictions and national press about convictions due to fraudulent claims, numerous firms shut/ closed that had been instigated in investigation's regarding crash for cash industry and a general sense that insurers are fighting back finally.
The vast majority of motorists support the insurance industry which is poles apart from those that support the claimant PI sector

Multifactoral I’d guess. A lull in people getting injured, people not bothering to claim, dodgy firms/CMCs being shut down and so on. It may also be that people claim quicker whereas they used to delay.

I’d be surprised if the forthcoming changes were to blame. I’d have thought the claims numbers would spike if they were being aggressively pursued.

If RTA PI claims have dropped by 130K in a year then it begs the question as to why that's suddenly occurred, given there as most likely been as many RTA's during the last year?? Would there have been a similar drop without the forthcoming changes being on the horizon?

The only compulsory insurance. So we have a captive audience so how do we maximize profits? Hmmm...lets make up a compensation culture, brown envelope the government and hit all the media companies and watch the lemmings jump off the cliff.
This scandal will come out at some point, as they all do eventually, but the people who are pulling the strings will be long gone by then!
Oh no wait...it must be the dodgy lawyers and doctors that are to blame...

Richard Walton. Your comment "Insurers in my eyes need to do more to help tackle fraud themselves. The lack also of insurer accountability is also a major factor here".
I will remain anonymous for this point of view.

A defendant major insurer proposed 50/50 liability on an RTA, even though the claimant was told immediately after the claim was submitted of an admittance to 'Losing Control' of his motor vehicle that ploughed into the clients vehicle.

That is my belief on how the Insurers are making the biggest profits in history. Fraud is becoming a way to openly practice deceit behind the cover of the DPA.

Every year, when my circumstances have not changed, my price for renewal goes up by £lots. When I complain I get offered a reduction to the previous year + £a bit.n If £a bit isn't much I renew to save 30 minutes on a comparison website otherwise I go elsewhere.

It is not even competitive on comparison websites as the variation in cost is often 50% between policies with exactly the same terms.

I have even had "new" quotes from my existing provider which, when I put in the same vehicle but 'move' 10 houses down the road and become 1 day older, are much lower than than they were prepared to offer to renew.

It is a fallacy that insurance companies will not pass any savings made from these reforms onto customers. They will have to do this, as the motor insurance market is almost entirely price driven and it's a very competitive market at that.

It is also a fallacy that personal injuries claims are the reason for the rise in motor insurance premiums or that that these reform will decrease those premiums, a fallacy this government has fallen hook like and sinker for. That is obvious from these figures alone.

The rise in motor insurance premiums is mostly because cars carry significantly more technology, such as sensors and cameras and are a just a lot more expensive to repair than before.

The insurance industry has spun the belief that by reducing personal injury claims it will fix a problem, but that problem is not fixable and it's all spin to try and eliminate an industry it despises.

It does beg the question why the government are so wedded to the idea and fixing something which is not even broke? If anyone requires any more compelling evidence that all is not quite correct here then they only need to look at the draft bill which contains no detail. Not even a definition of whiplash.

I've dealt with a good 20 cases over the last few years transferred to me from insurer panel firms (that I will not name) who had offered sometimes horrific service levels and worrying lack of understanding of the most basic principles underpinning what they were doing.

As I recall, one had its operatives based on a call centre in South Africa and charged £300.00 odd per hour under the terms of their retainer.

Not sure why my last comment was removed.
I'll have another go.
My only comment on all this is that as Haven bought out the claims early, as there was no medical evidence obtained, absolutely no-one has any idea whatsoever whether the Claimants were or were not worse off by settling early. That's the gamble of a pre-med offer and why they shouldn't ever have been allowed to sneak into PI work.

"The most telling story is the recent Haven direct capture story which highlights the fact the claimants are no worse off by dealing directly with insurers and get the same level of service but without losing 25%. "

Claim numbers falling, premiums being reduced and the daily desperate pleas from the Claimant PI Sector makes great reading.
A2J is simply failing so I'm sorry for all those who donated, the profession itself is not united and never has been so its unlikely to really influence the reforms.
The most telling story is the recent Haven direct capture story which highlights the fact the claimants are no worse off by dealing directly with insurers and get the same level of service but without losing 25%.
Whilst a few have found pleasure in the fact Haven may lose some money in costs this story is a great advert for the reforms

The SRA looked for firms breaching LASPO and found, in statistical terms, no evidence of malpractice.

The vast majority of the profession want nothing to do with spiv experts, hire companies and 'introducers' work.

The numbers of such dodgy experts and so on are so few as to be considered as nil against the wider profession.

The motivation to introduce the reforms cannot be supported by evidence and without such evidence given the affect on the legal profession, the rule of law (where will the judges of the future be drawn from), the treasury and the public then the reforms ought not proceed.

The rogue medical reports that have plagued industry for years didn't come from the insurance industry and they were encouraged by solicitors in this sector, the inflation of costs and ghost stage 1 costs pre reforms were again a product of this industry'

A2J are in complete denial about these things. It's everyone else's fault.

There's a long list that they are in denial about. Most of their campaign is based on it. It's why they don't have much support from a large sector of the profession.

I'd perhaps see it differently had they led a more honest campaign. But for me, they've just reinforced everything that a lot of people see as being wrong with the profession.

But Paul the mischief isn't "elsewhere" and its that kind of thinking that has mainly led to these reforms.
Claimant PI firms buy leads, these leads come from unsolicited calls lead by CMC's and without these leads your sector could not exists, so banning CMC's would spell the end anyway.
The rogue medical reports that have plagued industry for years didn't come from the insurance industry and they were encouraged by solicitors in this sector, the inflation of costs and ghost stage 1 costs pre reforms were again a product of this industry, and as such I beg to differ.

The MOJ seems wilfully and recklessly blinded towards any evidence based information that claims are falling as it scuppers the insurers narrative.

LASPO has seen a massive, massive boon to insurers profits, yet premiums have rocketed, as claims and costs have fallen dramatically.

Brett Dixon is spot on. The mischief is elsewhere. Why on earth is the Government so hell bent on pushing these reforms through, restricting and denying justice to injured victims, when Brexit continues to dominate business?

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